Wash. Post misleads on Obama administration plan for GM ownership
SUMMARY: The Washington Post quoted Mitt Romney saying that "the American public" -- not the president -- "ought to own" GM. But the article did not note that the Obama administration has said it has "no desire" to own equity in GM "any longer than necessary," and reportedly plans to sell all of its shares in the company within 12 to 18 months.
In a June 2 Washington Post article about former Massachusetts Gov. Mitt Romney's (R) criticism of President Obama, reporter Chris Cillizza wrote that "Romney was on 'Fox News Sunday' taking issue with the administration's plan to put General Motors into bankruptcy to restructure the company," and then quoted Romney as saying: "We don't want a president and a head of the [United Auto Workers] running General Motors. ... The American public ought to own that enterprise." However, in quoting Romney's criticism, Cillizza did not note that the Obama administration has said it has "no desire" to own equity in GM "any longer than necessary," or that the administration reportedly plans to sell all of its shares in the company within 12 to 18 months.
In a May 30 document outlining the framework for restructuring GM, the Obama administration stated that one of its "core principles" regarding government ownership in private firms -- which "will apply to the U.S. government's equity stake in GM" -- is that it has "no desire to own equity stakes in companies any longer than necessary, and will seek to dispose of its ownership interests as soon as practicable." The White House also stated, "The government will not interfere with or exert control over day-to-day company operations," will "only vote on core governance issues," and will be "extremely disciplined" in how it exercises its shareholder rights. A "senior administration official" reaffirmed the government's position in a May 31 briefing, saying, "GM will emerge as part of the [Section 363 of the bankruptcy code] process; and then the company will continue, as we said, as a private company operating in the for-profit commercial role and so forth. And the government, as we indicated, is a reluctant -- will be a reluctant shareholder for only as long as is necessary, for as long as -- we will be out as soon as is practicable." The official continued: "During that period of time, we imagine that the taxpayers want us to be looking after their money, and so as we indicated, there will be people here watching over that investment, but as I indicated, in the nature of passive shareholders similar to Fidelity or some other large investment firm that has a large stake in a company."
According to a June 2 Los Angeles Times article, "[White House auto adviser Steve] Rattner said GM would emerge from bankruptcy a private company and become public again in 12 to 18 months. The government expects to sell its shares in a series of transactions over time to maximize the return." The article quoted Rattner as saying, "[W]hile we want to exit as soon as possible, we also want to exit as soon as practicable in terms of being good custodians of the taxpayers' money." Similarly, a June 1 Detroit News article reported that "GM will remain privately held for at least six to 18 months," and that "U.S. Sen. Carl Levin, D-Detroit, said Monday it could be 'a few years' before the government sells its entire stake." The article also reported: "The government will have to sell its shares in chunks, likely in at least three separate transactions, Rattner said. Each sale could take at least six months."
From the Washington Post:
Less than 24 hours before hitting Obama on defense and national security, Romney was on "Fox News Sunday" taking issue with the administration's plan to put General Motors into bankruptcy to restructure the company.
"We don't want a president and a head of the [United Auto Workers] running General Motors," Romney said during the appearance. "The American public ought to own that enterprise."
Although Romney is derided by many Democrats, he is one of the most popular figures among the Republican faithful, many of whom believe his work on behalf of Sen. John McCain (Ariz.), the GOP presidential nominee last year, proved his mettle.
Republicans also regard Romney as perhaps their most effective economic messenger, able to draw on his success in the private sector in combating Obama.
And Romney, well, the American public DOES own the majority share of GM. You don't like how your elected representatives are running the company, elect someone else.
Anyway.
Who cares about share prices? Share prices don't have families who are losing their pensions.
Wages and benefits will probably stay up as the UAW owns a substantial portion of the Company. Work rules will probably change, benefits (especially legacy costs) will probably change, bonuses probably will not go up and will certainly for the near term go down or be non-existent. White collar jobs will be lost, along with blue collar jobs (if not in the manufacturing facilities, at least in the supporting sectors).
However, competitiveness in the global economy resides squarely on public investment in education and healthcare (not to mention the development of sustainable energy.) Free us from the chains of those high costs with a sensible public policy and watch entrepreneurship flourish.
Since you want to talk about share prices too, you'd do well to recognize that GM share values started decreasing, not only because of poor management decisions, but also due to that conservative responsibility-free notion of the market. That, "anything goes" attitude. So yeah, share values matter to the small fraction of Americans who are actively invested and they matter to the unfortunate souls who had their retirements invested for them, but you can thank the conservatives who stripped the market of protections against the capitalist predators for their suffering.
Have you read Michael Moore's essay on this matter, titled "Goodbye, GM"?
You can find it at the Huffington Post and elsewhere I'm sure... it includes within it not only his personal feelings about all that is happening to GM, but also an open letter of sorts, addressed to President Obama, as to what Mr. Moore thinks or hopes or wants to happen next, with GM.
It's very interesting, I won't go into the details here, and I won't judge the workability of what he suggests, but I will say that Moore's suggestions remind us that this is not only a new beginning at GM (as this whole thing is not the death of GM, just it's metamorphosis), but that the time is now to decide what to do next : the same old thing, or something different?
Anyway, it's a good read... it's a good read, because it's well written, and it's well written because it's written from the heart : as you cannot miss any of the allusions in the essay, that mark how much that GM has meant, good and bad, to Michael Moore and his friends and family and to all of the many others in Flint Michigan and elsewhere, who have purchased or ridden in a GM automobile, or otherwise rode along with GM.
The feelings are great in this matter, and they show in Michael Moore's words... read them.
Yeah lets impose a gas tax of an additional $2.00 per gallon. Light rail for everyone!
Lets take a train from Detroit to Chicago that only takes two hours when it only takes 4.5 hours by car. I'm sure by the time you drive from your house to the station, wait for the train, get to the station on the other end and drive to your destination, you'll be up to 4.5 hours. Don't forget the stops along the way or is that not part of the deal?
Lets take a 17 hour train from LA to NYC. Does MM even know how much that would cost? What about points in between.
Residents of Japan and France on average ride their bullet trains less than 400 miles a year. Average income people cannot afford to ride them regularly.
Besides the high costs, these trains do little to relieve congestion. "Not a single high-speed track built to date has had any perceptible impact on the road traffic" in Europe, says Ari Vatanen, a European Parliament member. California predicts its 220-mph trains would take just 3.5% of cars off of roads. California highway traffic grows that much every two years.
http://blogs.usatoday.com/oped/2009/05/a-high-speed-rail-mirage.html
Yeah. America hater MM who used GM to make his career, glories in the demise of GM and uses every cliche in the book to push his crazy idea instead of looking at the facts.
I'm sure MM is riding bicycles and trains right now or is this idea just for the "little people"?
Public transit is the way of the future. It's obvious you've been told to fight the strategic initiative of public transit no matter the environmental benefits and safe, efficient travel it could usher in.
And since you mentioned France and Germany's Bullet train, why don't you mention also all the wildly successful zero fare public transit in so many European cities?
How is anyone supposed to take your views of liberalism seriously when you can't remain cogent?
What the left is looking for in our relationship with rest of the world is cooperation and community. It's time to realize that the planet is just too small to ignore everybody else.
We are the greatest country in the world; we have brought more technology, medical advancement and more freedom to the world then any other. That is what makes us great, and in the past the Envy from others. Recently and more so with our current administration who is pushing socialism, and heavy taxation onto it citizen, we have lost the envy of some, but not all. I have never said anything about wanting admiration, I used the word admiration as something on the left wants and what makes us weak now. Example, Obama is looking for admiration right now from the Mulsim world, why, why does it matter?
Second, I never said ignore, but if one strives to be the best, others will come to you needing your help or guidance. I know you may have never experience something like this, but when you are the best, other want to follow.
Enviousness/ Envy; discontent or covetousness with regard to another's advantages, success, possessions, etc. denotes a longing to possess something awarded to or achieved by another.
Greatness; of extraordinary powers; having unusual merit; very admirable:
Admiratrion; the act of looking on or contemplating with pleasure: a feeling of wonder, pleasure, or approval. Synonyms: approval; esteem, regard; affection.
And to your parsing exercise between admiration and greatness, do people not admire greatness? You are the one stuck on being admired and praised for your country's greatness. Yet you never stop to realize it has been the conservative stripping of the great American values of effective government, broad prosperity, mutual responsibility, smarter defense and better future that has stultified our progress to greatness.
How many stops would you expect? Ann Arbor, Jackson, Kalamazoo maybe?
I've driven Det-Chi many times myself. You are correct about traffic jams on 94 in Chicago.
My point is that MM is living in his fantasy world. He only talks about time in transit, not the real time it would take.
My guess is a train would make all the stops. So lets say someone in Dearborn wants to travel to Chicago. They'd have to drive in, possibly fighting rush hour traffic to get to the downtown station. That alone would add 30 to 45 minutes. What if they have luggage? Will there be Homeland Security check points? You betcha there will. Add another 15 minutes at least. Check in, boarding, luggage all will add time. Then you repeat the steps at every stop. At the other end, you may have to get your luggage, but if not, you will then have to fight that same stress of getting out on 94 to get to your destination. Heck, it takes an hour to drive from downtown to the northern border of the city. If one takes the El, then one would have to wait for the right train, adding minutes, repeat the procedure, and then when finally dropped off, most likely have to have someone pick you up and drive to your destination. If you are in a suburb, that might take another hour. Any net time savings? No way and not to mention having to travel on the governments time table.
The problem with mass transit is that it is step backwards in time, convenience and logistics. It certainly isn't any cheaper. If I remember correctly NY to Washington is $99. Greyhound is $20. It works in the heavily populated urban areas, but doesn't beyond those areas.
Just love that conservative view of people as a cost. How wonderfully human of you to see people as an expense to be marginalized. May you never be viewed as an economic burden, OTG.
I will at some time in my life be an economic burden in some form, however with proper preparation, it should be a burden only to those around me and shouldn't be onus.
Perhaps, if over the past couple or three decades, workers had realized that they would be responsible in some way for their declining years, that part of the problem with the auto industry would be less than it is today. Too many people were brought up with the concept of free lunches (and dinners, etc), that we can live for today because tomorrow will be someone else's responsibility, that we have gotten ourselves into a pickle that is plenty sour.
"If over the past several decades workers had realized that they would be responsible for their declining years, that part of the auto industry would be less than it is today."
What kind of condescending vision of the American working man and woman do you hold? Do you really believe that everybody but you are irresponsible children? Really? Nobody is concerned for their future but you? Not to mention you blame the laborer for stagnating wages and rising costs of living, not a broken economy that has progressively, for the last few decades, been rigged to work for the benefit of fewer and fewer elites instead of the real wealth creators; laborers. As if the consistently rising productivity of the American laborer is to blame for off-shoring, out-sourcing and lay-offs that management wields to drive down wages and benefits.
Obama made a decision to build small cars in a closed plant.
Sure looks to me like he wants to run a car company.
Obama made a decision to change the marketing budget for Chrysler.
Obama fired GM CEO.
Obama IS running the car companies with a 31 year old
person with no business experience, no economic education and no legal experience.
Obama will put another $30 Billion into GM by his own words.
GM is a full employment effort that will build cars that no one wants.
Obama has no exit plan for getting out of GM, his "core principles" notwithstanding. He plans for the government to own GM forever, statements to the contrary notwithstanding.
"I will take public campaign financing."
"I will not hire lobbists for my adminstration."
Obama is a socialist. I didn't realize it when I voted, but I do now.
Where do you guys get this stuff? Hope you don't donate to the rightwing think tank that hatched that rotten egg.
Well if you'd leave the echo chamber every now and again you may find these little tidbits in the state run media...
Obama forces GM's Wagoner out
30 billion more of tax payer money to GM
I could go on but I hope you get the point. This has all been documented and reported over the last month.
On another note...
Watched ABC news the other night and they had the requisite sob story of three generations of GM auto workers. They were lamenting the demise of GM and the low wages that the grandson was making in today's dollars.
Not once did they ever ask the auto workers how they felt about Barry's new re-tooling of GM. Never once were they asked how they voted last Nov.
I'm guessing when they pulled the lever for hope and change they never thought it would cost them their pensions and jobs.
Specifically, I was talking about the socialist jab and the blame Obama for the failure of an empty conservative philosophy of materialism and consumerism. You guys need to move on. Get past that malarkey, it just makes you look stupid unreasonable and petty. It indicates you're not to be taken seriously and you have no intention of solving problems cooperatively because you have no ideas, just epithets.
Perhaps you can go a little deeper than spouting off left wing talking points?
Just what, in your opinion, is the conservative philosophy of materialism and consumerism? Are you advocating something else? If so what philosophies are those? What ideas do you have for solving problems cooperatively?
I'm puzzled by your last sentence. What are those 'epithets'?
The AMERICAN PUBLIC DOES own that enterprise now, you moron! That's not OBAMA's personal stock, you know! If "the government" owns it, well... that's as PUBLIC as it gets!
I know, I know... I'm palying fast and loose with public-owned, private-owned and public-traded. But these guys wouldn't know a nationalized industry if it liquidated their stock.
Really you know Obama has such a track record of telling the truth.
I will close Gitmo, oh wait I stuck my foot in my mouth too fast on that one.
I will not hire lobbyist, well not really
I will give 95% of Americans a tax break, opps, no really I am going to tax you even more.
My stimulas package will hire million of individuals, of course that is after I let 4 million plus lose their jobs in the auto industry.
I will post all bills on line for several days before signing, opps, no I want
I will have a website that will show how the stimulus money is being spent. Wait, not till next year.
I will have a transparent government, opps, no I will do what I want and not tell you.
I will not be like the Washington of Old, wait yes I will, since I am only hiring folks that have been around here for a while.
Yea, like I am going to believe Obama at what he says about GM, I have not seen his word worth much, but sure you all will continue to following this man around.
I mean when Chavez says Obama is more left then him, wow, you all must be so proud.
What flavor are you drinking today? :-)